Neeble-Diamond v. Hotel California By the Sea, LLC
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In this case, the Court of Appeal of the State of California Fourth Appellate District Division Three heard an appeal from Amanda Neeble-Diamond against a postjudgment order, awarding costs exceeding $180,000 to the prevailing defendant, Hotel California By the Sea. The original lawsuit involved both statutory and nonstatutory causes of action based on Neeble-Diamond's alleged employment status with Hotel California, which was determined by the jury to be that of an independent contractor, not an employee. Following this judgment, Hotel California sought costs and attorney fees. The trial court denied attorney fees but awarded costs, which led to Neeble-Diamond's appeal.
The issue at hand was whether the trial court could award costs to the defendant without finding that the plaintiff's California Fair Employment and Housing Act (FEHA) claims were objectively frivolous. The appellate court agreed with Neeble-Diamond, reversing the order that awarded costs to Hotel California. The court highlighted that in FEHA cases, a prevailing defendant has no automatic right to recover costs. Instead, the defendant must move the court to make a discretionary award of such costs, based in part on a specific finding that the action was frivolous.
Hotel California forfeited any claim to costs by failing to file the necessary motion for costs as they did for attorney fees, rendering their cost memorandum ineffective. As a result, Neeble-Diamond had no obligation to respond to the cost memorandum, and the court erred by signing an "amended judgment" that included an award of $180,369.41 in costs to Hotel California.
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